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Mutual Funds

Looking to invest into mutual fund ?

We will help you to make your decision better in terms of tax effects, returns and your goals.

Mutual Funds Investment

A mutual fund is a type of financial vehicle made up of a pool of money collected from many investors to invest in securities. To match the investment objectives stated in its prospectus a mutual fund’s portfolio is structured and maintained. Professional money managers operate mutual funds to allocate fund’s assets and attempt to produce capital gains or income for the fund’s investors.

How to start Mutual fund investment

With fund house, you need to open an account and complete your KYC, to start a mutual fund investment. Many investors find tough to create a mutual fund portfolio, which is next step. First, few schemes with credible long term performance record needs to be shortlisted. To understand its performance history of shortlisted funds, you should analyse its short and long term returns. Next, pick the ones that are in line with your risk profile and investment objectives.

To invest in  mutual funds there are two opinions.

  1. Direct plan of a mutual fund: Go directly to the website of the mutual fund you want to buy and invest in it from there.
  2. Regular plan of a mutual fund: Hire a mutual fund advisor who will manage your fund on your behalf.

Mutual fund investment guide for beginners

  1. Fix an investment goal: A major role in your investments are financial goals, budget and tenure. This will help you decide how much you can set aside for investment and re-evaluate your risk appetite.
  2. Choose right fund type: for the first time investors, experts typically recommend a balanced or debt fund as it comes with minimal risks while giving you higher returns.
  3. Shortlist and choose one mutual fund: Factors like manager’s credentials, expense ratio, portfolio components and assets under management are also need to considered, at the same time select the one that has performed well consistently for at least 5 years.
  4. Diversify your portfolio: A portfolio of funds will help you diversify across instruments and investment styles. This will reduce the risks- in case one fund underperforms and other makes up for it, without bringing down your entire portfolio.
  5. Go for SIPs instead of lump-sum investments: If you are considering to invest in equity or equity oriented funds at first time investor, then systematic investment plan (SIP) is the best. The advantage of rupee cost be more or less that comes with SIPs also helps you earn higher returns over the long term.
  6. Keep KYC documents updated: KYC is a government regulation for most financial transactions in India. PAN Card and valid address proof helps to become KYC compliant.
  7. Open a Net Banking Account: Through mutual funds allow investments to be made with debit card and cheques, still net banking is a  simpler and secure methods to be make investments.
  8. Seek advice from a mutual fund expert: Tedious and overwhelming can be entire process of investing in mutual funds. If you find choosing the best mutual funds is tiresome then get the services of  a mutual funds from are experts and distributors now available everywhere in Mumbai and near to you too.

Mutual funds investment benefits:

As an investor, either you can manage your finances yourself or hire a professional firm. You can opt for the latter when:

  1. You don’t have idea how to the job in the best way.
  2. You don’t have sufficient time or inclination.
  3. By outsourcing the job instead of doing it yourself when you are likely to save money.
  4. You can spend your time for other activities of your choice or liking.

The best benefits of Mutual Funds is Professional fund management. There are no reason why one should look at any other investment avenue other than us.

Mutual Funds Investment Short and Long Term:

An investment holding period of one year or less, the tax rules defines it as short term. Selling such investment that was held for less than 12 months is known as short term gain or loss. Longer than one year investment hold or sold for a profit or loss will produce long term gain or loss. The important difference is that different rates are taxed to long term and short term capital gains. Lower rates are taxed to long term gains.

A mutual fund must distribute net capital gains to shareholders at least once a year. Most mutual funds total up short and long term gains for the year and make the distributions during the last couple of weeks of December.

Mutual Fund Investment Process/Procedure:

Primary and secondary processes are 2 steps to follow for investing in Mutual Funds. The primary process is more to facilitate the process and help you become a mutual fund investor. The second step you are able to invest in the right fund, as it is more customized filters.

The first step ie primary process ie KYC needs to be completed before starting your investments in the mutual funds.

In the second step you need to take a call between lumpsum and SIP.

Five basic things to review of the fund factsheet before the final investment in the fund:

  1. In case of equity and debt funds look at the uniformity of the returns generated over time. More than the significant of returns, it is consistency that matters.
  2. Look at risk adjusted returns.
  3. Check the portfolio mix
  4. Look at the total expense Ratio (TER). Benchmark the fund performance to the total Returns Index  of the Index. That is a better measure of outperformance as TRI also factors dividends.

Mutual fund investment process of your must be a combination of regulatory process and the analytical process. That is a good start to your investment journey.

Mutual Fund Risk:

In term of standard deviation of an asset class risk could be measured. Risk can be below types:

  1. Systematic Risk: It is defined as risk that occurs because of macro- economic factors in all the risky assets. However it cannot be eliminated through diversification.
  2. Unsystematic Risk: It is defined as a risk that is unique to a particular asset class and can be eliminated or reduced by diversifying a portfolio.

The higher the potential return, the higher the level of risk involved.

To invest in mutual fund get in touch with our tursted experts.